Iron ore starts new year with a leap
Iron ore begins new year with a bang as Chinese crude steel output is expected to top one billion tonnes this year for the first time. Supported by firm demand in steel and positive sentiments in China after the New Year holiday, iron ore price hit new highs on January 4 with 62% iron ore fines climbing to $165.20 per tonne CFR China.
Although 58% iron ore fines remained unchanged at USD 149.63 per tonne, high grade 65% Brazilian iron ore fines climbed to $181.50 per tonne.
Meanwhile, Dalian iron ore futures also climbed by 3.9% on Monday as paper traders still remain firm on iron ore prices given restocking from mills as the production control for heavy pollution in Tangshan is expected to be removed in coming days.
Additionally, China’s rebar price gained for the second day on January 4 and the domestic steel market sentiment improved on noting the spot sales of construction steel spiked due to speculative buying and restocking needs ahead of the one week long Chinese New Year holiday starting February 11.
China is also planning to build one or two globally significant overseas iron ore mines by 2025 to boost the supply of the steelmaking ingredient and strengthen its pricing power.